Over the past few days, we’ve been receiving questions regarding this information that has appeared on the government website:
What does this information mean?
> Your childcare voucher scheme will close to new entrants on 6 April
> The need for working parents to receive a childcare voucher by 5 April is a very different approach to that adopted by HMRC in 2011, where setting up a first order (up to 12 months in advance) by the deadline was all that was required.
What is our view on this information?
As a childcare voucher provider we are concerned that:
> The information on HMRC’s website has changed a number of times and we are still waiting for formal clarification on the above
> There are still no formal guidelines available - ad hoc and often conflicting advice is being given by HMRC, and is changing on a regular basis
> The timing of the announcement leaves a very narrow window for parents to register on the scheme AND receive a voucher by 5 April
> The legislation required to close childcare vouchers is still to be tabled, so the 5 April 2018 deadline may yet change
> In addition to the recent two-hour government debate on the petition to keep childcare vouchers open, the Tax-Free Childcare scheme is currently under a lot of scrutiny - by Parliament, the Treasury Select Committee and the media - as a result of the issues parents are experiencing.
We have contacted HMRC for clarification of this new rule via the Childcare Voucher Providers Association (CVPA), but are still awaiting a response from them.
It’s important to remember that, as a childcare voucher provider we are here to offer guidance based upon the available facts, but do not have any further information beyond what is stated on the HMRC website.
Based on the information currently available, here is our advice to parents:
> It’s important to get all working parents signed up to childcare vouchers today, so they receive a childcare voucher by 5 April. Once on the scheme they can take their time deciding which scheme is best for them (they can always switch to TFC at a later date).
> All parents who have previously registered for childcare vouchers must receive at least one voucher in every rolling 12-month period. If their eligibility has lapsed i.e. it’s more than 12 months since their last order, they need to receive a voucher before the April deadline.
> Many parents won’t be eligible for TFC and will be better off with childcare vouchers, tax credits or a combination of both. Getting them registered for childcare vouchers is the best way to ensure they can take the time to choose the best solution for them.
We will update you as soon as we know more.
For more information about Tax-Free Childcare, visit www.giveyourselfachoice.com